Average Cost of Employer Health Plan Up 5%: Survey

The average cost of an
employer-provided family plan is now $13,375, up 5 percent from 2008, according
to a new report by the Kaiser Family Foundation and Health Research &
Educational Trust.

USA Today: "An average family
health insurance policy now costs more than some compact cars, and four in 10
companies will likely pass more of that expense on to workers." The
increasing costs "underscore warnings by President Obama about the growing
cost of health insurance and were embraced by Democratic lawmakers who are
pushing for legislation to change the nation's health care system. ... The
annual survey of more than 2,000 companies also found that 40% of
small-business employees enrolled in individual health plans pay annual
deductibles of $1,000 or more. That's almost twice the number who paid that
much in 2007" (Fritze, 9/16).

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Kaiser Health News: "The 5
percent increase in employer-sponsored health insurance costs for family
coverage is less than the double-digit growth in premiums earlier this decade
but was sharply higher than overall inflation, which dropped 0.7 percent this
year, mostly due to declining energy prices. ... Paul Fronstin, senior research
associate at the Employee Benefit Research Institute, said that 'employers see
raising deductibles as the easiest way to control costs.' The higher
deductibles are one reason why premiums have been going up more slowly in
recent years. 'It's a crude instrument, but it does the job,' he said"
(Galewitz and Villegas, 9/15).

The Washington Post: "Forty
percent of employers surveyed said they are likely to increase the amount their
workers pay out of pocket for doctor visits. Almost as many said they are
likely to raise annual deductibles and the amount workers pay for prescription
drugs. Nine percent said they plan to tighten eligibility for health benefits;
8 percent said they plan to drop coverage entirely. Forty-one percent of
employers said they are 'somewhat' or 'very' likely to increase the amount
employees pay in premiums -- though that would not necessarily mean employees
would pay a higher percentage of the premiums. Employers could simply be
passing along the same share of the overall increase that they are doing this
year" (Hilzenrath, 9/16).

The Philadelphia Inquirer:
"Responses to a separate telephone survey of 1,250 adults that was
conducted in July showed slightly more people were worried about not being able
to afford needed medical care than about paying their mortgages or losing their
jobs." (Burling, 9/16).

The Boston Globe: Major health
insurers in Massachusetts "plan to raise premiums by about 10 percent next
year, prompting many employers to reduce benefits and shift additional costs to
workers. Increases will range from 7 to 12 percent, capping a decade of
consecutive double-digit premium increases, according to a Globe survey of the
state's top health insurers. Actual rates for 2010 will depend on the size of
the employer and the type of coverage, with small businesses and individuals
expected to be hit hardest. Overall, premiums are more than twice as high as
they were 10 years ago.

"The higher insurance costs
undermine a key tenet of the state's landmark health care law passed two years
ago, as well as President Obama's effort to overhaul health care. In addition
to mandating insurance for most residents, the Massachusetts bill sought to
rein in health care costs. With Washington looking to the Massachusetts
experience, fears about higher costs have become a stumbling block to passing a
national health care bill." (Weisman, 9/16).

BusinessWeek: "The Business
Roundtable, which represents CEOs from the largest U.S. companies, warned in a
report released Sept. 15 that annual health-care costs for businesses will rise
166% over the next decade, to nearly $29,000 per employee, if Congress does not
enact significant coverage and cost reforms." But "the Roundtable is
not keen on several of the proposals coming out of Washington, and in a press
briefing its members made it clear they are not willing to support the creation
of a government-financed insurer, i.e., the so-called 'public plan,' as
contained in a House bill" (Arnst, 9/15).

The Wall Street Journal: "Business groups
that have opposed House versions of a health bill say they are warmer toward
the version emerging from Sen. Max Baucus's Finance Committee, which places
less-onerous requirements on employers. - The House version of the health
legislation would require some employers to pay as much as 8% of payroll as a
fine if they don't offer coverage to workers. Under the Senate Finance measure,
employers who decline to provide coverage would face a smaller penalty, and in
narrower circumstances." But employers are still concerned that "a
provision to tax insurance companies on generous health-insurance benefits
could get passed onto employers. Some groups also say the Senate proposal
doesn't go far enough to lower overall health-care costs" (Adamy, 9/16).

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